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March 3, 2021

BNR injects RON 5 bln in the inter-bank market, through repo operations

The National Bank of Romania (BNR) yesterday conducted a repo operation through which it injected RON 5 bln into the market, at an annual interest of 9.5 pc, equal to the monetary policy rate.

A number of 13 banks participated in the operation, which involved a loan termed at one month.

Repo-type operations are used by BNR to provide cash to commercial banks, in exchange of state bonds. The interest rates announced Monday by commercial banks for one-day deposits rose to 9.48-9.98 pc, far above the 5.94-6.44 pc announced on Friday, when banks had an excess of cash in store for the end of the reserve period. For one-week deposits, interests were on a slight rise, from 9.39-9.89 pc to 9.49-9.99 pc. BNR conducted its most recent repo operation on May 15, when BNR put RON 2.52 bln in the market, termed at one month, at a 9.5 pc interest. BNR made repo operations in April (temporary infusion of liquidity by repurchasing state bonds) at a daily average of RON 811 M, 17.5 pc more than RON 690 M in March and almost twice February’s figure. The average interest rate for these instruments stood at 10.03 pc a year, down from 10.09 pc in March and 10.14 pc in February. During the same interval, reverse repo operations (state bonds sales in order to draw cash from the market) averaged RON 25 M a day.

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